Field calls for full employment and shifting of wealth

In the second of four lectures in Durham on Labour's future, Frank Field argues that his party can rebuild a natural coalition despite the huge redistribution of income that has left Labour 'floundering' after the Thatcher years. On Monday, he argued that Labour had to start by re-ordering its own constitution. Today and Thursday he argues in detail for a new welfare and industrial strategy based on individuals owning their own pension entitlements, and for a return to the 'forgotten goal' of full employment.

LABOUR must move Britain back towards full employment and produce a huge shift of wealth by giving individuals ownership of the pension funds which control half of British industry, Frank Field, the Labour MP for Birkenhead, said yesterday.

Such moves could help rebuild the coalition of voters Labour needs to win, said Mr Field, who is chairman of the cross-party Commons Social Services Committee.

In the second of four lectures at Durham University on Labour's future, he said the party must no longer measure success in welfare purely in terms of increasing the size of the budget. It must also stop being seen as the party 'running an ambulance service picking up capitalism's failures'.

Instead, Labour ought to be equally interested in seeing the welfare bill cut as more people gain an adequate income from work, or wealth, or both.

In a challenge to the view that the Conservatives have built a permanently winning coalition of the successful top two-thirds of the population against the rest, Mr Field argued that while the poor have undoubtedly got poorer and more numerous under the Tories, the reality offers Labour the chance to become again the majority party. For while living standards as a whole have risen, only the top 20 per cent, on almost any measure taken, have increased their share of total income from the tax cuts and other changes of the Tory years, Mr Field said.

The result is not so much that the poor have been left behind, but that the very rich have drawn further away - Government statistics showing not a split of two-thirds well off, one-third badly off, but that two-thirds of people live in households below average income. 'The importance (of that) has yet to be seized on politically,' Mr Field said. Among that two-thirds are many caught by the unpredented level of mortgage debt and both the reality and fear of unemployment which has affected more of the population than at any other time for the current generation.

Unemployment, he said, was 'the key economic home issue and one to which the Tory party reacts like a frightened rabbit'. It was the key issue 'because at some stage Britain, and with it Europe, will disintegrate into social chaos and violence unless counter economic action is taken' - and its costs are huge, both personally and in terms of lost wealth.

Unemployment was hitting white as well as blue collar workers, its dark shadow 'falling on a larger and larger proportion of the population. A coherent and well argued policy at home and in Europe to move the country and Europe back towards full employment will be highly attractive,' Mr Field said. Unemployment was 'the greatest recruiting sergeant for poverty', was holding up recovery, and was an issue which lined up the interests of the poor and 'mainland Britain'.

Tackling that, and transferring to inviduals the pounds 250bn of corporate wealth owned by pension funds, would ensure fewer people at risk of poverty in old age, and one aim of Labour's welfare policy 'must be to cut off the supply routes to deprivation'.